Book Cover

Democratic
Capitalism,  The Way to a World of Peace and Plenty
by Ray Carey

Hard/Softcover/Kindle - 5 May, 2004, Available on Amazon.com

Ray Carey presents the theory and practice of democratic capitalism by coupling his experience with a synthesis of the thought of Adam Smith, Karl Marx, and John Stuart Mill.  The empirical evidence is clear: democratic capitalistic companies produce superior results, and nations that support economic freedom and keep money neutral improve the lives of their people.


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Course 1:9

Help the Victims

To date, the government has responded to the economic disaster quickly and with great determination by pumping hundreds of billions of your Fed money into the financial institutions that caused the problem. There has been no equivalent action to help the millions of victims.

The problem is jobs now and jobs in the future. Jobs now will require movement of retirement savings out of Wall Street into infrastructure repair. There is still almost $3 trillion of 401 (k) in Wall Street while there is $2 trillion in overdue repair of roads and bridges. Government action is needed to act on this opportunity.

Jobs in the future and solution of the deficit problem will come only from rebuilding economic growth from under 2% to over 3.5%. This growth will have to reverse the effect of shareholder capitalism’s downsizing that regularly sacrificed long-term building programs for short-term stock price.  This ugly capitalism is still with us. Read the recent headlines about the Cisco CEO who responded to Wall Street and the financial media’s heckling about quarterly earnings by announcing that  8,000 people will be fired.

There is an amazing amount of idle cash sitting in corporate surplus--$ 1 trillion abroad and another $1 trillion at home. Much of this is the product of firing people for the last quarter century. Nothing could be fairer than to use this money to rebuild both the economy and  retirement accounts. This money should be taxed if it is not moved into the economy in either growth investment or dividends. Taxes would also penalize its use for stock buy backs and deals, but taxes would be eliminated on the return of foreign funds to the American economy.

There has been discussion but no action:  “ Politicians have been carping about the more than $2 trillion in cash sitting idle in corporate coffers even as unemployment remains high. But much of that cash isn’t in the U. S; it’s abroad and wont come home unless tax laws are changed.” 1 

This plan should be coupled with tax-free dividends for low-and-middle-income wage earners with these benefits:

These tax changes would result in a double-digit steady return: one-half from 5% dividends and the other half a modest 5% increase in earnings and stock price. Dividends would again be 50% of the return from capitalism and the workers could join in J.P. Morgan’s emphasis “ Don’t talk to me about return on capital, talk to me about return of capital!”

For the past quarter-century “shareholder capitalism” has dominated the economy. Growth programs were sacrificed, people fired, and stock bought back, all to hype the stock price. Total buy backs from 2005-2007 was $1.4 trillion, 56% more than the previous 6 years combined. 2 Cisco is an example of a company that has accumulated cash despite weak growth: Currently on hand, $43 billion, all but $5 billion in foreign countries. 3

These  suggestion are made in an environment in which currency and credit are controlled for the benefit of the speculators, not the general welfare, and the Fed is a protector--not regulator--of finance capitalism. Most of those responsible for reform come from Wall Street and inevitably bring that mind-set with them. Wall Street money dominates the politicians and leaves the victims un-represented. It is for this reason that  citizens must build their own reform agenda.

1. Jason Sweig “Why Investors Can’t Get More Cash Out of U.S. Companies” WSJ 2/19/2011 B 1

2. Liam Denning, “Corporate Buy Backs Test the Concept of Value.”  WSJ 10/5/2010 C 10

3. Susan Pulliam,  “ Nader Kindles Fires of Revolt,” WSJ 6/24/2011 C 1

Ray CareyRay Carey

Ray Carey learned through managing companies for 33 years how to change the work culture to provide employees with their best opportunities to develop and contribute. This experience began as a 28 year old plant manager and later president of an electric motor company, and concluded with eighteen years as president , chairman, and CEO of ADT, Inc.

See Carey's autobiography of his work career in chapter two of his first book,

Democratic Capitalism, The Way to a World of Peace and Plenty.

For more information about Ray Carey and his advocacy of democratic capitalism, visit the pages of this website.


Most Recent Post

Democratic Capitalism: The Way to a World of Peace and Plenty

Updated on Jan 11, 2017

For some time there has been a general feeling that there is something wrong with the American economy. There is: the domination by finance capitalism slows growth and keeps millions from good jobs.

The solution: Democratic Capitalism, was described in my book but it was rejected by publishers and received no reviews. I published and distributed it at my expense but in time the following leaders of industry and education confirmed the solution. 

Click here for the full post